Euro Surges Up after EU Leaders Agre on Long-Term Union

The euro spiked higher against its most major counterparts in Asian trading on Friday after European Union President Herman Van Rompuy said that the leaders have agreed to use the continent's permanent bailout fund to recapitalize struggling banks and agreed to the idea of a tighter union in the long term.

EU President said that banks can be recapped directly with aid funds, calling it a "breakthrough". He also noted that the leaders agreed to a joint banking supervisory body. 

EU leaders also welcomed the European Central Bank's decision to serve as an agent to the European Financial Stability Facility and later to the European Stability Mechanism, when it comes into force, in conducting market operations. 

The finance chiefs said they intend to task Eurogroup to implement these decisions by July 9, 2012. 

The European Union leaders, who began their 2-day summit in Brussels on Thursday pledged to inject 120 billion-euro, or $149 billion, package to promote growth in the debt-stricken eurozone as well as across the broader 27-nation European Union. 

The growth package includes a 10 billion euro capital boost for the European Investment Bank. It also redirects 60 billion euros of unused structural funds to help small enterprises and create youth employment in most needy countries.

The euro that ended Thursday's trading at 1.2444 against the US dollar gained 1.5 percent and hit an 8-day high of 1.2629 in Asian deals. On the upside, 1.275 is seen as the next target level for the euro-dollar pair.

The euro was under pressure yesterday, hitting a fresh 3-week low of 1.2409 against the dollar in European deals as German employment data disappointed investors. But the euro-dollar pair mostly moved sideways in the New York as caution ahead of the outcome of the first day of European Union summit in Brussels refrained investors from taking bets. 

The euro's rise against the yen in Asian deals helped it recover from yesterday's fresh 3-week low of 98.35. The euro-yen pair reached a 4-day high of 100.25 and the next upside target level for the euro is seen at 101.0. The pair closed Thursday's New York session at 98.90.

The euro also strengthened sharply against the pound, hitting an 8-day high of 0.8091. This was up 0.9 percent from yesterday's close of 0.8021. If the euro-pound pair advances further, it will target the 0.815 level.

Against the Canadian dollar, the euro jumped to an 11-day high of 1.2981 from yesterday's closing value of 1.2863. On the upside, 1.30 is seen as the next target level for the European currency.

The euro also climbed to a 3-day high of 1.2445 against the Australian dollar and if the euro gains further, it will target the 1.250 level. The euro-aussie pair ended yesterday's trading at 1.2393.

But the euro held in a tight range against the Swiss franc, with the pair currently trading at 1.2014. 

Looking ahead, Japan's housing starts data for May is due at 1 am ET.

In the European session, French GDP for the first quarter, Swiss KOF leading indicator for June, Eurozone M3 money supply for May and the inflation estimate for June, U.K. services index for April  are slated for release. 

The U.S. and Canadian GDP data, Canada's industrial product prices and raw materials price indexes -all for May, the Chicago PMI and the University of Michigan's final consumer confidence report-both for June are expected in the New York session.

U.S. stocks begin lower

U.S. stocks opened lower Monday with investors losing any cheer from Greek-election results to concern about rising government bond yields in Spain. "The market has moved beyond Greece to Spain, which has both a government debt issue and a banking loan problem that is crippling its efforts to tap the capital markets at a reasonable rate," emailed Kevin Giddis, head of fixed-income capital markets at Raymond James Morgan Keegan. The Dow Jones Industrial Average DJIA -0.37%fell 39.28 points to 12,727.89. The S&P 500 Index SPX -0.32% shed 3.52 points to 1,339.32. The Nasdaq Composite COMP -0.06% declined 5.2 points to 2,867.60.

Zinc‏ (LME) intraday: the downside prevails.

Pivot: 1915.0

Our Preference: SHORT positions below 1915 with 1866 & 1855 as next targets.

Alternative scenario: The upside penetration of 1915 will call for a rebound towards 1933 & 1953.

Comment: as long as the resistance at 1915 is not surpassed, the risk of the break below 1866 remains high.

Trend: ST Ltd downside; MT Range

US Job Data 6000 More Claims

WASHINGTON (Fortune Signal) - The number of Americans who filed requests for jobless benefits rose by 6,000 last week to 386,000, the U.S. Labor Department said Thursday. Claims from two weeks ago were revised up to 380,000 from 377,000. Economists surveyed by MarketWatch had projected claims would fall to a seasonally adjusted 376,000 in the week ended June 9. The average of new claims over the past four weeks, meanwhile, increased by 3,500 to 382,000, the highest level in six weeks. Continuing claims decreased by 33,000 to a seasonally adjusted 3.28 million in the week ended June 2, the Labor Department said. Continuing claims are reported with a one-week lag. About 5.82 million people received some kind of state or federal benefit in the week ended May 26, down 145,990 from the prior week. Total claims are reported with a two-week lag

Pre-Market Summary

CURRENCIES: Lower Euro zone risk concerns puts the Dollar under pressure.
ENERGIES: Crude complex mixed to start; cautious ahead of OPEC meeting
BONDS: Initial bear control, a bounce off the #'s & weakness into the auction
STOCKS: Uncertainty keeps trade contained; focus on JP Morgan and Retail Sales
METALS: Hope of easing and increased EU anxiety leaves the bulls with an edge
CORN: Soil conditions continue to decline but some rain helps and late June?
WHEAT: Crop Production and supply/demand updates today
BEANS: USDA report to set tone today; tightening new crop stocks?
CATTLE: Highest beef trade since March may hold cash steady this week; firm
HOGS: Surge in bellies/ribs suggests better than expected demand; more up
COCCOA: Tight West African supplies keep cocoa prices well supported.
COFFEE: Positive outside market factors give coffee prices a boost.
COTTON: USDA bearish; record high world stocks at a whopping 68.4% of usage
SUGAR: Need some help from outside market forces or another swing down

Crude Oil Intraday | Pre-EU

Crude Oil (Jul 12) intraday: the downside prevails.

Pivot: 83.20
Most Likely Scenario: SHORT positions below 83.2 with targets @ 81.05 & 80.
Alternative scenario: The upside penetration of 83.2 will call for 83.85 & 84.5.
Comment: The RSI is bearish and calls for further downside.

Decline from 1608 is in three waves, liekly part of a recovery from 1555. Break of 1603 put 1610/12 in play. We will turn aggressively bearish when decline will unfold impulsively.

First-time jobless claims fall to 377,000, down 12,000; four-week average edges higher

The number of people who filed for unemployment assistance in the U.S. last week fell broadly in line with market expectations, official data showed on Thursday.

In a report, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending June 2 fell by 12,000 to a seasonally adjusted 377,000, in line with expectations.

The previous week’s figure was revised up to 389,000 from a previously reported 383,000.
Jobless claims have remained below 400,000, a level historically associated with an improving labor market, in 30 of the past 32 weeks, though lately claims have been pushing higher from the 350,000 associated with above-average job growth.
Continuing jobless claims in the week ended May 26 rose to 3.293 million from an upwardly revised 3.259 million. Analysts had expected continuing claims to decline to 3.245 million.
The four-week moving average was 377,750, an increase of 1,750 from the previous week's revised average of 376,000.

The monthly average is seen as a more accurate gauge of labor trends because it reduces volatility in the week-to-week data.

Following the release of the data, the U.S. dollar remained modestly lower against the euro, with EUR/USD adding 0.18% to trade at 1.2604.

Meanwhile, U.S. stock index futures held on to gains after the release of the data. The Dow Jones Industrial Average futures pointed to an increase of 0.55%, S&P 500 futures indicated a gain of 0.75%, while the Nasdaq 100 futures signaled a 0.65% advance.

Copper! More Weakness in the weeks to come

More weakness to come in weeks ahead

Copper Intraday

Copper (CME) 6/6/2012 11:29 AM 1 week Trend: (=) 1 month Trend: (=) Copper‏ (Jul 12) intraday: the downside prevails. Pivot: 3.35 Our Preference: SHORT positions below 3.35 with targets @ 3.3 & 3.24. Alternative scenario: The upside penetration of 3.35 will call for a rebound towards 3.375 & 3.405. Comment: the upward potential is likely to be limited by the resistance at 3.35. Trend: ST Ltd downside; MT Bearish

1 Hour Gold is in Range ! Trade on BreakOut

1 Hour Gold is in Range. We recommend to trade on Break Outs.

Gold Should Reach to New High

Gold should reach new highs in this week, maybe even around 1640, but after 1628 break of wave b) extreme.